The downward trend that in recent years affected residential
values, which have begun to stabilize, has shifted to commercial
land, Corser said. He said owners of commercial properties have
been challenging the values assessors have assigned to them as
being too high.

"Vacancies are high and they are looking for tax relief," Corser
said in a telephone interview Monday.

The county has a $20 million contingency reserve. County
Executive Officer Larry Parrish has asked for that account to be
tapped to cover the $6.2 million shortfall.

Parrish prepared a
detailed report
examining how well the county was
doing halfway through its current budget year ---- Jan. 1. The
report is scheduled to be delivered Tuesday to the Board of
Supervisors.

While there is money to cover the gap, Corser said the county
will need to find a way to restore the contingency fund to $20
million for the next budget cycle.

"So we've got a fragile balance for this year," he said. "And
next year, it is even more fragile."

Last summer, the county projected total general fund revenue of
$584.4 million.

Parrish said in his report the county now anticipates $578.2
million ---- $6.2 million less.

What's more, he projected revenue will fall further to $572
million in fiscal 2012-13.

County officials had hoped the impact of the recession would
bottom out this year, not next. But it looks as if revenue won't
grow again until fiscal 2013-14, Parrish said.

Revenue has been falling steadily since the collapse of the
housing market, after peaking at $785 million in fiscal year
2006-07.

But all the news is not bad.

"There are some signs that economic recovery is accelerating in
Riverside County," Parrish wrote.

He said the area's stubborn unemployment rate is improving
gradually. It was 12.5 percent in December. A couple of years ago,
it was 15 percent.

"Unfortunately for the county budget, however, this has not
translated into an increase in our dominant revenue source ----
property taxes," Parrish wrote.

"So people are spending a little more," Corser said. "Maybe not
on houses yet, but on new cars."

On the flip side of the financial picture, some big departments
are on track to finish the year in the red.

Parrish reported the Sheriff's Department expects to finish $2.5
million over budget, the
registrar
of voters
office expects to finish $1.8 million over and the
Fire Department anticipates closing the year $1.7 million over.

Parrish said departments are closer to staying within budget
now, however, than they were a few months ago.